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We need to keep in mind that a major chunk of our gargantuan population falls under the low-income category. It may seem obvious as a reason to believe that this is the root of our low health insurance literacy, but it isn’t entirely true.
So, what exactly is Health Insurance? In simple terms, it’s a financial support system you purchase to tone down your monetary burden if you go through medical emergencies.
Even though the Insurance Regulatory and Development Authority of India (IRDAI) has amplified the measures to educate people about health insurance, their reach has been very limited due to lack of knowledge and averseness.
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Understanding Health Insurance and its Pesky Snags
The health insurance condition in India is distressing, as most of the population perceive Health Insurance as an addition to their financial baggage, which is rather obvious. Ironically, as per National Sample Survey Organization (NSSO), the principal reason for a high level of indebtedness amidst the lower-middle-class and middle-class population is due to rising medical expenses.
The fundamental reason that we all are aware of the escalating medical inflation and yet are disregarding it.
Why do you need Health Insurance?
It depends on when you are buying an Insurance Policy and for whom are you considering it. Although the need for health insurance varies from one use case to another, here are the top 3 reasons why we think you’d need Health Insurance for –
1. Inadequate Savings –
When it comes down to saving money, we as a nation are quite good at it, no? But think about it again, do you save enough to encounter medical emergencies? The savings are inclined more towards being invested for better returns in the future.
You can agree that you’d want top-notch medical facilities if you were ever to be hospitalized, and it can be quite expensive. In all honesty, it can be very challenging to manage your finances if a family member gets diagnosed with a dreaded illness if you didn’t see it coming. The worst part is that nearly 44% of India’s 1.5 bn population are not covered by any sort of Health Insurance.
And people either take a dip into their savings, sell assets, or seek loans to gather funds for the treatment and make ends meet. However, only if they had a Health Insurance Plan in place, they might have sustained the bulldoze of a financial burden.
2. Medical Inflation –
The scale at which the medical expenses are rising makes it imperative for us to buy Health Insurance. This increase in per-person medical cost due to inflation, also known as the medical trend rate, is at an all-time high.
The forecasted medical trend rate will be at 10%, while the inflation stays at 5%. That’s the trend rate rising at double the inflation rate. Today, diseases like cancer and circulatory system disorders are already the top two highest claims followed by gastrointestinal and respiratory conditions. There are a lot of insurance policies focused on critical illness benefits for you to fight such conditions effectively.
3. Hidden Hospital Costs –
Your treatments at a hospital are not just limited to the costs incurred during your hospitalization. Several underlying costs like pre-medical checkups, doctor’s fees, and prescribed medicines often account for a chunk of expense higher than your hospitalization charges. In parallel, there are diagnostic tests and post-surgical/operative care that may require an attendant to take care of you for a couple of weeks/months. Add up all the above factors, and you have the answer to why have your medical expenses skyrocketed.
Health Insurance Plans cover a wide array of ailments and conditions. You might think that Insurance only takes care of the surgery, but you are only partly correct. There are policies that take care of several or all the above-mentioned aspects associated with your hospitalization like pre-/ post-hospitalization charges, medicines, medical checkups, and more.
Benefits of owning Health Insurance in India
What’s in it for you? The following highlighted points will explain to you in detail about the benefits you get for having a Health Insurance Policy –
Changed Lifestyle –
The way people live today, and their concurrent activities are quite unpredictable. Just when you might have thought that the pandemic is subsiding, the World Health Organization (WHO) dropped a bombshell named, Omicron.
Such situations lead to either a very low physical activity or extremely quick-paced traveling, forcing you to dismiss minor ailments that can turn severe in the future. Meaning, Health Insurance has become a substantial necessity that can facilitate healthy living by enforcing timely medical checkups and treatments at the best of hospitals in India.
Financial Buffer –
Every person envisages enjoying a financially stable life for themselves and their families in the foreseeable future. However, having financial stability is directly dependent on your capacity to save funds. Now, you can save up ample cash to secure the future, but, what if you cross paths with a medical emergency? An absence of having Health Insurance at this point can drain your savings down the gutter within no time.
Hence, purchasing health insurance is as important as saving money for the future. In fact, having a policy in place can help you manage your savings better offering you a huge safety net.
Tax Benefit –
As per section 80D of the Income Tax Act of India, you as a policyholder are liable to get a tax deduction of up to Rs. 50,000 on the insurance premium paid for yourself and your parents. Consider this as a mindful investment that gives back returns not just monetarily but medically as well.
Some SCARY FACTS that will probably help you reconsider the need to get Health Insurance –
1. The life expectancy in India was 69.5 years for men and 72 years for women in 2019. Just because of the pandemic, you have been further robbed by 2 years from your existing life, bringing down the expectancy of men at 67.5 years and 69.8 years, in 2020. Let that sink in.
2. To add on top of it, there have been roughly 4.77 lakh deaths in India over a span of 21 months.
3. The healthcare scenario in India is such that there’s only fragmented care when it comes down to pre-existing diseases (PEDs). This is due to the larger emphasis given to acute care than chronic care. Our country is home to 7.7 crore type 2 diabetics, and we are only second to China. Just imagine, the number is expected to touch 13.4 crores by 2025.
4. Approximately 30% of the Indian population suffers from hypertension. The scarier part is that nearly 70% of India does not get themselves medically checked in a year.
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Ditto offers free insurance-based consultations, answers your queries, and helps you choose your policy wisely.
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